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Abstract

This paper examines the role of the various players in the port industry and their interactions, and determines the impact of their actions in port operations. A mathematical approach has been developed to assist port authorities in decision making for infrastructure investment. The model examines the port investment decisions within the context of a multimodal transportation system. Model results are used to answer questions regarding the optimal investment strategy of a port authority in order to maximize the net social benefit; the impact of this strategy to the terminal operators and users; the effect of competition or cooperation between carriers; and the shippers’ behavior in terms of quantity and price of goods shipped over the intermodal network. The paper concludes with a practical interpretation of the results of the theoretical models. Further improvements that would capture real world issues that are not adequately treated by the current models are discussed.

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